February 18th, 2025—the Federal Trade Commission (FTC) and the Department of Justice (DOJ) announced the ongoing implementation of the Joint 2023 Merger Guidelines, signaling a continued commitment to the precedent of stringent antitrust enforcement previously initiated by the Biden administration. [1] The purpose of these guidelines is to inhibit monopolistic business practices, especially among technology conglomerates and private equity firms, by implementing a thorough, standardized system of rules and regulations for evaluating mergers and acquisitions (M&A).
The 2023 Merger Guidelines introduce several pivotal amendments to antitrust enforcement. Notably, they a) lower the required threshold at which a merger is presumed anticompetitive, b) intensify scrutiny of vertical mergers—when multiple corporations within the same industry, but operating at different stages of production, join together, and c) place significantly greater emphasis upon the impacts of such mergers on labor markets. Rachel Lamorte and others explain that these revisions mark the start of a strategic shift towards a more aggressive governmental stance on M&A activities that could stifle competition or undermine consumer interests. [2]
FTC Chairman Andrew Ferguson, however, called regulatory attention to the necessity of stability in antitrust regulations in an internal memo, stating that frequent alterations in standards between presidential administrations may very well subvert the regulations’ efficacy. He emphasized that it was important for the 2023 Merger Guidelines to serve as the operative structure for merger reviews “for the foreseeable future,” which would allow both businesses and legal practitioners to expect a more steady, consistent system of rules by which to abide. [3]
Of course, to fully comprehend the possible impacts of the updated guidelines, one might find it constructive to examine past mergers that might have faced challenges under the new regulations. Meta’s acquisition of Instagram in 2012, for example, was a horizontal merger that eliminated a direct competitor in the social media market. [4] Under the 2023 guidelines, the reduced requirement for anticompetitive presumption would likely have resulted in a stricter evaluation of the deal, primarily raising objections over Meta’s resultant market concentration. Similarly, corporate giant Amazon’s purchase of the grocery line Whole Foods (a vertical integration, also its largest-ever acquisition) combined a leading online retailer with a brick-and-mortar supermarket chain. [5] The new guidelines impose more stringent examinations of vertical mergers in particular, which could have led to grievances regarding competition across supply chains, as well as reduced consumer choice.
Proponents of stricter antitrust laws maintain that robust regulations are key to preventing the formation of all-powerful monopolies that dictate market terms, suppress innovation amongst competitors, and exploit the ordinary consumer: the corrupting dominance of the very few companies in the Gilded Age, such as the juggernaut ventures of Andrew Carnegie (steel), John D. Rockefeller (oil), Cornelius Vanderbilt (railroads), and J.P. Morgan (banking) comes to mind. Supporters of the new guidelines argue that they are a necessary response to the growing influence of technological giants (Google, Apple, Meta, Microsoft, etc.) and the highly complicated financial structures used by private equity firms, which often obscure anticompetitive practices. [2]
On the other hand, opponents contend that the new laws constitute excessive government intervention, the likes of which classical economists like Adam Smith have traditionally warned of. They caution that the guidelines may crush legitimate business growth and efficiency. Lowering the threshold for anticompetitive presumption may be a form of regulatory overreach that deters societally beneficial mergers and cultivates a general attitude of uncertainty and distrust for businesses planning strategic M&A deals. [2]
And just why is ‘too much’ market concentration a net negative? The answer is that high levels of concentration are strongly correlated with monopolistic behavior like price-fixing and discouraging innovation from competitors. The 2023 guidelines incorporate various economic tools to account for this fact and investigate how proposed mergers may alter market dynamics (such as effects on pricing, quality, and consumer options). [2]
The guidelines’ highlighting of the comprehensive disclosure of deal structures and interrelationships raise additional challenges for private equity firms in particular. The increased administrative burdens are intended to improve transparency and combat anticompetitive consolidations, of course, but it may not always be easily feasible—practically, financially, or otherwise—for firms to comply. [6]
The FTC and DOJ’s 2023 Merger Guidelines represent a continued effort to progress the adaptation of antitrust enforcement to the sophisticated modern economy, especially in sectors dominated by technological giants and powerful financial firms. While they are designed to protect competition in global markets and defend consumer welfare, the practical implementation of these guidelines will necessitate very careful balance to avoid undue hindrance of legitimate business activity. As these laws take effect, an ever-evolving, ever-changing conversation between involved stakeholders—e.g. legislators, industry stakeholders, companies, investors, legal professionals, and ordinary consumers—will prove vital in governing the contemporary antitrust landscape.
Sources
[2] New HSR Rules and 2023 Merger Guidelines – Here to Stay?
[3] https://www.ftc.gov/system/files/ftc_gov/pdf/ferguson-memo-re-merger-guidelines.pdf
[4] Facebook Buys Instagram for $1 Billion – The New York Times
[6] New U.S. Merger Rules Would Weigh Heavily on Private Equity – WSJ
[7] Thumbnail Image: https://onepathlegal.com/corporate-law/